What is 5g?
What is 5g?
5g is magic for those who model with Excel. It's free. It makes modeling easier and quicker. It brings the power of dynamic arrays to beginners. It reduces model risk enormously. If you have Office 365, you have everything you need - no special skills required!
5g is short for fifth generation Excel modeling. It is a standard for converting complex formulas into named functions that are simple enough for anyone of any skill level to use in any workbook.
5g functions are crafted by industry experts with advanced Excel skills. They look and feel like Excel's functions. When we enter a 5g function, Excel's IntelliSense prompts us for arguments just like Excel functions. If we need it, we can request inline help, just like Excel's functions. And like Excel's functions, 5g functions are thoroughly tested before being handed over for use. But unlike Excel's functions, we can examine the inner workings of any 5g function and we can understand it because 5g functions are made from 100% native Excel functions and operators - and nothing else.
Why is 5g important?
Spreadsheet errors have inflicted millions in losses. Research reveals most spreadsheets have significant errors. The best cell error rate (CER) found by researcher Prof. Ray Panko was .38%. At that rate, 1 in every 265 formula cells contains an error; thus, one way to reduce model risk is to reduce formula cell count.
120 to 1
Dynamic arrays can reduce formula cell count in the typical 10-year monthly financial model by a factor of 120 to 1. Such models contain 120 formula cells, (one cell for each month in every year) in every calculation row. Dynamic arrays can replace those 120 formula cells with 1 formula cell that spills across all 120 periods and because dynamic array SPILL ranges contain results, not formulas, there is no possibility for the common model error known as inconsistent formulas. Dynamic arrays have numerous other advantages which makes them highly attractive for financial modeling; however, to use them in financial models requires advanced Excel skills unless we use 5g.
5g wraps formulas using advanced techniques in simple functions anyone of any skill level can use in any workbook. This is how 5g brings the power of dynamic arrays to all financial modelers. And 5g can make dynamic arrays even more powerful.
1000+ to 1
A single 5g function in a single cell can replace thousands of formula cells because a 5g function can calculate entire model sections, not just one row.
Instant Expertise
5g functions are created by industry subject matter experts with advanced Excel skills. Their expertise is inside their functions. When a junior staff member uses one of their functions, the junior staff member instantly performs, for that function, at the expert's level.
Speed to Market
5g functions are much smaller and simpler to use than the formulas they replace. With only a few keystrokes, major model sections can be added. When 5g matures, models will no longer be built from formulas, rather they will be assembled much quicker from functions.
A Standard. Not a product.
5g is a standard for creating 5g functions. The standard insures 5g functions can be used in any workbook by anyone, including novices.
Dynamic Array Focused
5g is primarily (but not exclusively) focused on bringing the power of dynamic arrays to everyone. Dynamic arrays are revolutionary and can do incredible things. They are the next generation of Excel modeling which is where the name, 5g , originated: fifth generation Excel modeling.
5g's Value
Quick: 5g functions can add entire model sections, like depreciation schedules or amortization schedules, in seconds.
Correct: 5gfunctions are crafted by experts and thoroughly tested for quality.
Easy: 5gfunctions require no special skills.
5g's Requirements
5g's only requirement is our Excel version. It must be fairly current. Excel online is always current. If our desktop Excel version supports LAMBDA, then we have all we need.
How do I get 5g functions?
5g functions are available free on the web and for sale at Eloquens.com. To find free 5g functions google "5g Functions Excel".
Example 5g Function
Below is the 5g function, Depreciateλ(). This example shows how 5g works with dynamic arrays to solve real world modeling problems in seconds.
Can I see an example model built with 5g?
The video at right features Depreciateλ in a completed 3-way financial model that is made of 100% dynamic arrays with 5g functions.
The model is simple but too valuable to give away. It is bundled with the 5g Financial Starter Pack which is available on Eloquens.com. The Financial Starter Pack is a workbook containing a collection of 5g functions with documentation and working examples for each function.
Summary
5G functions make creating models with dynamic arrays easy. They require no special skills to use and they work in any workbook.
If you are one of the technical elite, this site provides the information you need to create your own 5g functions. Share your expertise with coworkers to raise their performance. Publish your creations to the world to help others. Or sell your masterpieces on Eloquens.com.